Webcam War


Play video games? Use a web cam? Chances are you're familiar with Logitech (LOGI), the company that makes personal accessories for your computer. But competition is fierce; especially from Microsoft (MSFT). Can Logitech beat Bill Gates in this high stakes contest?

Logitech Chief Executive Guerrino De Luca joins the guys for this conversation via satellite from Palo Alto, California.

Dylan Ratigan asks De Luca about the size of the market for computer personal accessories?

$6-$7 billion and LOGI controls about a third of that market, explains De Luca. That includes webcams, keyboards, mice, PC speakers, remote controls, etc.

De Luca adds that although LOGI sells directly to PC makers, 85% of its revenue is in the after-market.

Eric Bolling asks if NetGear (NTGR) is a big competitor?

Not exactly, says De Luca. NetGear is in the infrastructure business. LOGI sells to consumers.

How vulnerable are you to MSFT, asks Dylan.

We’ve been competing with Microsoft for 20 years so we’re used to them, replies De Luca.

Dylan asks the guys what they think of the stock.

Eric Bolling likes NetGear more. Guy Adami says he likes LOGI as a growth story. Tim Strazzini calls the stock a great play on games, but cautions investors to be careful of the margins. Jeff Macke is also concerned about margins.


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Trader disclosure:
On May 4, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders: Strazzini Owns (SNDK), (TIN); Bolling Owns (SZE), (DIS), (NMX), (VE), Gold, Silver; CNBC Is A Service Of NBC Universal And Dow Jones, Vivendi Owns 20% Of NBC Universal, The Parent Company Of CNBC